Burning homes for tax breaks, firefighting practice in Wis.


By Tom Kertscher
Milwaukee Journal Sentinel (Wisconsin)
Copyright 2006 Journal Sentinel Inc.

If you want a bigger house, and your wallet's big enough, you don't add on.

You burn down.

People are getting the local fire department to burn down their house - some worth $150,000 or more - to make room for a new and bigger home.

And they get a tax break in the process.

"I just have never heard of that," said a flabbergasted Trena Bond, executive director of Housing Resources Inc. in Milwaukee, which helps low-income people buy first homes.

"I can't imagine they're doing that. Other people can't even find a decent house to live in."

The practice of torching and razing perfectly good homes might seem the epitome of suburban excess. But it's all a matter of perspective, and in any case it's great for firefighters.

"That's the best type of training that you can get," said Mark Hetzel, the fire chief in Raymond in Racine County.

In places such as South Milwaukee, or in Jackson in Washington County, homes that are burned down by the fire department often are on their last legs and in the way of a new development.

"They're usually beyond help," said Jackson Fire Chief John Skodinski.

But it's different in places such as Mequon or in Waukesha County's Lake Country. While residents there live in homes that would be the envy of many, they call the fire department because they want to build a new and larger home, and they don't want to move.

Mary Harrington said she had been in her Mequon home, where the backyard vista is Lake Michigan, for a year and a half when she looked into remodeling. She said the costs were comparable to building a new home, so she offered it to the Mequon Fire Department. Now going up next to the old garage is a 6,320-square-foot home with four bedrooms and five bathrooms, according to plans filed with the city.

In Delafield, a home on Nagawicka Lake that is assessed at $640,000 (excluding land) took the place of a home the same owners had the city fire department burn down two years ago. That home had been assessed at $202,000. In January, the Town of Delafield Fire Department burned Clarence Weisflog Sr.'s home on Pewaukee Lake. It had been assessed at $222,000, although Weisflog, one of the owners of a metal fabricating company in Cudahy, insisted it wasn't worth that much.

Among other things, the turn-of-the-century home was so poorly insulated that, in winter, it cost more to keep the temperature at 48 degrees there than it did to keep the temperature at 70 at his Cudahy home, Weisflog said. "We didn't tear down a palace, by any means."

"It's an expensive home because of its location," he said. The land itself has an assessed value of $272,000.

Weisflog said he was attracted to the burn-down option partly because of the tax advantages. They can be substantial, according to Rick Taylor, a partner with the Virchow Krause & Co. accounting firm in Milwaukee.

The owner of a $150,000 home who lets the fire department burn it down can get a tax deduction worth about $37,500 - about 25% of the home's value, though that entire amount would have to be spread out over more than one year, Taylor said

The tax advantage was one factor for Julie Erickson, but she said she mostly felt that her Mequon home on the bluff of Lake Michigan could not be remodeled. It is tentatively slated for a burn and demolition next spring.

Erickson said the 58-year-old, 2,000-square-foot two-story which the city rates as being in "average" condition, not only leaks but is poorly insulated, was added to haphazardly and has a kitchen that is "absolutely non-functional."

"By the time you start replacing everything like that," she said, "it makes more sense to rebuild."

Mequon residents Janet and Steven Peterson were afraid of what their neighbors would think of their 50-year-old, aluminum-sided ranch in which they had resided for four years. The Petersons were building three new homes on adjoining lots.

So they had it burned.

Being built in its place is a 3,500-square-foot, all-brick home that has a two-story family room.

"It was kind of surreal because there were memories there," she said. "But it would have needed quite a bit of an upgrade."

DONATING YOUR HOME

Property owners who want to raze their home in order to build a larger one in its place can save money on the costs, and qualify for a tax break, by donating their home to a local fire department, which burns it for firefighter training.

A sampling of communities in the five-county Milwaukee area that accept such donations:

Milwaukee County

Bayside

Fox Point

Greenfield

Hales Corners

South Milwaukee

Ozaukee County

Mequon

Port Washington (city)

Thiensville

Racine County

Raymond

Wind Lake

Washington County

Germantown (village)

Jackson (village)

West Bend (city)

Waukesha County

Brookfield

Chenequa

Delafield (city)

Delafield (town)

Hartland

Lannon

Oconomowoc (city)

Sussex

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